Oil firms to implement staggered price hikes

MANILA, Philippines — With diesel price increases surging past P5 per liter amid the conflict in the Middle East, major oil firms are set to stagger this week’s scheduled fuel price hikes to soften the blow on consumers.

Officials of the Department of Energy and oil industry players yesterday committed to “balancing economic realities with the need to shield our people from sudden price shocks,” DOE officer-in-charge Sharon Garin said.

Price adjustments will be spread throughout the week to ease the impact of sudden spikes at the pump.

In separate advisories, Shell and Seaoil said gasoline, diesel and kerosene prices are poised to go up by P1.75, P2.60 and P2.40 per liter today, respectively.

A second wave of identical increases will follow on Thursday, bringing this week’s total hike for gasoline, diesel and kerosene to P3.50, P5.20 and P4.80 per liter, respectively.

Aside from Shell and Seaoil, Petron, Caltex, Jetti, Petro Gazz, Phoenix, PTT Philippines, Unioil, Total, Filpride and Cleanfuel have also agreed to the move, but have yet to announce their implementation schemes.

Big-time pump adjustments this week exceeded earlier industry projections after the United States bombed three Iranian nuclear sites over the weekend.

The market is on edge as tensions between Israel and Iran could disrupt trade flows in the Strait of Hormuz, a major trade route for global oil and gas shipping.

The DOE has urged oil companies to offer fuel discounts to the transport sector and “exercise prudence in passing on costs” to motorists.

“Much of the recent price volatility is being driven not by actual supply disruptions but by speculative trading due to geopolitical uncertainties,” Energy Undersecretary Alessandro Sales explained.

As of yesterday, the average pump price of gasoline, diesel and kerosene stood at P55.90, P53.40 and P70.22 per liter, respectively.

Garin will meet today with transportation and agriculture officials to plan targeted subsidies for public transport drivers and farmers should the average crude prices breach the $80-per-barrel threshold.

Dubai crude oil’s average price was at $75.16 per barrel yesterday, the DOE noted.

Suspend VAT

The regressive 12-percent value-added tax on petroleum products should be suspended by President Marcos, women’s group Gabriela said yesterday.

“Promos or discounts are not enough, the way these are being discussed by the DOE and oil companies. What we need is concrete action to prevent the spiraling cost of oil prices in the market,” Gabriela party-list Rep. Arlene Brosas said.

Suspending the VAT on oil is a short-term urgent relief measure, she noted.

Repealing the Oil Deregulation Law and permanently scrapping the VAT on oil, utilities and basic necessities should be prioritized, she added.

P8K fuel subsidy

A fuel subsidy of P8,000, up from P6,500, should be given to operators and drivers of public utility vehicles, transport group Manibela said.

Fuel subsidy cards in previous distributions contained only P4,000 to P5,000, Manibela chairman Mar Valbuena recalled.

Subsidies should be distributed by July 10, he noted.

Valbuena said oil companies should not implement oil price hikes – estimated between P3 and P5 per liter – this week since they still have reserve stocks.

Aid should be extended to tricycle drivers and operators, according to Ariel Lim, president of the National Confederation of Tricycle Operators and Drivers Associations of the Philippines.

Removing excise taxes on fuel is better than fuel subsidies, he said.

Funds for tricycle drivers’ fuel subsidy should be handled by the Department of the Interior and Local Government, he noted. — Delon Porcalla, Ghio Ong